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Published: Thursday March 20, 2014 MYT 5:50:10 PM
Updated: Thursday March 20, 2014 MYT 5:51:07 PM

Britain sets out Europe's energy alternatives to Russia

BRUSSELS (Reuters) - Europe has a range of options to shore up its energy security and cut dependence on Russian supplies, including asking the United States to export more gas and working with Iraq, a British government document says.

Following Russia's annexation of Ukraine's Crimea region, talks between European Union leaders in Brussels on Thursday and Friday are focusing on how Europe can make itself less reliant on Russian gas pumped via Ukraine.

The 28 EU states also want to be in a position to supply Ukraine with energy should Russia cut off supplies. They are expected to ask the Commission, the EU executive, to draw up an in-depth study of EU energy security by June this year.

Britain's discussion paper, circulated to other EU governments and seen by Reuters, calls for a 25-year plan as well as measures for the nearer term.

It says this week's talks "should make clear that Europe will work in a coordinated and expedited manner to reduce its high energy dependency rates".

At their meeting in Brussels, EU leaders are also discussing to how ramp up their response to the crisis in Crimea, amid growing doubts over whether they are united enough to impose hard-hitting sanctions on Moscow.

The EU has however already taken steps to diversify its energy sources in response to previous crises when Russia cut off supplies to Ukraine.

It has backed a new link, the Trans Adriatic Pipeline, to import Azeri gas and has improved infrastructure to allow gas to be pumped from the EU into Ukraine, rather than the other way round.

But analysts say that if Russia turned off supplies for any length of time, Europe would still face major problems.

Britain says in its discussion paper that exploration of how to ship Iraqi gas to Europe should be intensified, and cooperation with other strategic partners enhanced.

EU-U.S. energy talks should examine how to bring about gas exports from the United States to the European Union, it said, and consider how that could be reflected in transatlantic trade talks.

The United States has begun granting licences to export liquefied natural gas, but progress has been slow because of political sensitivities about keeping most of the gas for domestic use in the United States.

Analysts say the natural destination for U.S. exports would be Asia, where gas prices are higher than in Europe, although even limited shipments to the European Union could be of help.

Britain - which only receives a small amount of Russian gas during peak winter demand via a pipeline link to continental Europe - is proposing U.S. gas as just one of many options.

It also urges EU authorities to help member states exploit their own resources through regulation on completion of a single, liberalised energy market and targeted aid.

Already Britain has successfully lobbied against more onerous EU legislation that might have thwarted its aim to develop shale gas.

With France's EDF, Britain is also seeking to build a new nuclear plant, but the Commission has raised concerns Britain's funding plans break EU competition law.

"The European Commission should prioritise energy state aid cases to facilitate rapid deployment of infrastructure in the EU ensuring security of supply," the discussion paper says.

(Additional reporting by Oleg Vukmanovic in London; Editing by John Stonestreet)

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